Six-year-old music fintech company Utopia Music is reportedly set to reduce its staff costs by 20 percent after completing multiple acquisitions during late 2021 and early 2022.
The expense-reduction plans of Utopia Music just recently came to light in an internally circulated memo, per Music Week. For reference, the Swiss business bought Quincy Jones-backed Musimap in September of 2021, acquired artist-advance service Lyric Financial in October of the same year, and scooped up industry directory ROSTR and data-analytics platform ForTunes in December.
Then, the purchasing spree continued in the new year with the January buyout of UK-based distributor Proper Music Group, followed by February deals for indie publisher Sentric Music Group and Absolute Label Services.
Back to the initially mentioned internal memo, Utopia CEO (and former Facebook exec) Markku Mäkeläinen is said to have touched upon a “need to realise synergies, remove overlaps to make the Royalty Platform division leaner, and improve the velocity of our value creation.”
As part of this effort, Utopia is reportedly being organized around two main units, Utopia Music Tech (led by COO Roberto Neri and encompassing Absolute, Sentric, and Utopia Distribution Services) and the aforesaid Utopia Royalty Platform (led by Mäkeläinen). The latter is reportedly expected to face staff cuts, and execs are said to be reviewing the personnel within the music-supervision and creator-services divisions as well.
Addressing the layoffs in a statement, a Utopia Music spokesperson said in part: “Like many growth companies in today’s macroeconomic environment, Utopia is making changes to its internal structure to optimise the business. We’ve grown rapidly in two years, organically and through 15 acquisitions. Now, we’re realising cost synergies across these acquisitions and focusing on sustainable growth.”
Meanwhile, several of the affected professionals have already weighed in on the unfortunate news on LinkedIn. Some of these individuals’ positions at Utopia include commercial project coordinator and business analyst.
Utopia Music is hardly the only company that’s made layoffs in recent months amid a growing focus on reducing expenses and maximizing profitability.
Facebook parent Meta laid off over 11,000 employees earlier in November, for instance, whereas Spotify initiated a new round of employee cutbacks, this time in recruiting. Additionally, Downtown’s CD Baby and Soundrop announced layoffs of their own in October “due to the current economic conditions,” while Amazon’s Amp that same month laid off about half its team.